First up is this position trade setup on EUR/USD. After making a run back to the 1.3500 handle last month, the pair has dropped a couple hundred pips the past few days. It is now sitting right smack on a rising trend line, with yesterday’s candle even forming a spinning top. If you’re brave enough, you can buy now at market and set a stop below the trend line. However, if you’re a cool cat and wanna wait for more confirmation, there’s nothing wrong with that as well.
Ha! So much for the support line I drew up yesterday on NZD/USD! It blew up like a Kanye West single as price just melted through .8270. Now that Stochastic is deep in oversold territory, don’t be surprised if we see a small retracement on this pair. Make sure you keep tabs on the .8270 area, as it may just served as a support-turned-resistance point!
A fan of breakouts? Then here’s a setup for you! After recovering nicely yesterday, Cable is now stuck in consolidation mode and has formed a nice bullish flag. Normally, this is seen as a bullish pattern but there’s definitely potential for it to break in either direction. Look out for some marubozu candles, as this could be a sign that the pair is headed back to highs around 1.5950 or back down low to 1.5800.
To get the complete picture and avoid getting blindsided by economic data, you also have to do your fundamental analysis.
Lucky for us, Pip Diddy fills us in on what we need to know about fundamentals with his Daily Forex Fundamentals.